For Coach (COH), big moves after earnings reports are becoming a habit. That trend was intact Tuesday when the high-end handbag seller topped analysts' earnings estimates and posted surprisingly bright North American numbers, lifting the shares 11%.

New York-based Coach was expected to earn 80 cents a share on sales of $1.18 billion in the fiscal third quarter, according to FactSet, but it exceeded both, turning a profit of 84 cents a share with revenue of $1.19 billion. However, it was the North American segment, its largest, that was the real standout.

While the China component of Coach's business remained strong, with sales rising around 40% year over year for the third consecutive quarter, domestic sales totaled $792 million, up 7% from the prior year. More impressively, same-store sales were much better than predicted, climbing 1%, compared with a decline of 1.4% that had been foreseen by Wall Street analysts.

Coming into the quarter, it would have been easy to imagine a drab

By Desmond Lachman

If ever one needed evidence that excessive money printing by the Federal Reserve and by the Bank of Japan was seriously distorting global market prices, all one need do is to look at the EUR 2 trillion Italian sovereign-debt market. For despite the clearest of evidence of a marked deterioration in the Italian political and economic outlook, over the past three months Italian government bond prices have rallied to their strongest levels in the past two years.

The current mispricing of Italian government bonds is most unfortunate. Since not only does it remove pressure on Italian politicians to get their country’s political and economic house in order. It also lulls European policymakers into a false sense of security that somehow Europe is going to muddle through its sovereign debt crisis without basic institutional changes to the European Monetary Union.

The troubling outcome of the February 25 Italian parliamentary elections, together with the considerable